Figure 1
In work for the IPPR Commission on the South
East (Bramley 2005) I looked at potential housing numbers for
this key region from several viewpoints. While clearly the Barker
economic analysis points to a large increase in supply in this
region, I also pointed out that the same conclusion can be reached
from more traditional planning methods and criteria. Based on
projected household growth, but taking account of realistic migration
and overspill requirements from London, and also based on job
growth and labour supply numbers, I argued that the South East
should be planning for more like 44,000 extra households per year,
not the 25-28,000 preferred by the Regional Assembly. I suggested
that, in view of market pressures and job growth trends, much
more growth needed to be accommodated in the west and south west
of the region, which were not served by the existing designated
growth areas. Furthermore, as argued below, there is no sensible
way of delivering the large amount of affordable housing which
most people agree is needed in this region without a larger total
quantum of supply.
RELATIVE IMPORTANCE
OF PRIVATE
VS SUBSIDISED
HOUSING
I have argued above for a substantial increase
in the supply of both general market housing and affordable/subsidised
housing. To promote one without the other would in my view be
foolish and short-sighted. For example, some have argued that,
in the South East, only or mainly affordable housing should be
built. This will clearly not meet requirements of an economy and
society based on 70-75% owner occupation; it will not be fundable
by either the Government or s106 agreements; it will reproduce
unpopular and unsustainable social housing ghettos; it will drive
house prices ever higher; etc etc.
Response of Planning System to Demand for Housing
for Sale
Planning and planners have often been criticised
for ignoring the market, and Barker can be seen as the latest
round of this debate. The Government is now leaning towards requiring
the planning system to pay more attention to market evidence,
not in place of but alongside its established concerns with environmental
sustainability, social and economic need. It is not suggested
that planning should abandon all this and slavishly follow every
market trend. Planning is necessarily long term, and it should
seek to shape and steer development in desirable directions. I
think the key new elements which are being added are (1) the notion
of affordability targets as a key criterion of adequacy of housing
supply, and (2) the requirement to have regard to market evidence
as one signal of whether planning decisions are broadly right
or should be reviewed. Affordability is actually a marriage of
market and social concepts, not a purely market criterion. The
use of price signals can arise in different contexts, but I shall
just comment on one.
Barker suggested that there might be an element
of land supply which was contingent on market conditions; if prices
were higher, or rising faster, than expected, more land should
be released. This idea is being taken forward in planning guidance,
and I contributed to some work on this for ODPM. I do think that
it is a good idea in theory. It may be thought of as the "feedback
loop" for affordability targets. It is particularly good
if linked to another desirable feature of planning, namely that
it should look further ahead and be less "incremental".
In other words, planning should look forward 20-25 years and identify
those areas which are most suitable for urban development. On
this basis, there should be a large portfolio of sites which are
potentially to be developed for housing. There would a "batting
order" (phasing) of these sites, but the key point is that
this could be revised, or accelerated, if the market signals indicated
a need for more supply. Without such an orderly, longer term planning
approach, market-contingent land release could be recipe for some
very bad decisions, taken in haste and repented at leisure. There
are still dangers and limitations. In particular, because of the
time lags involved in housing supply, there is some danger that
supply triggered during a market boom may come on stream during
a market downturn (given that we have not wholly abolished market
cycles in housing). Nevertheless, that danger is probably less
than the danger of maintaining a completely rigid and unresponsive
supply system.
REGIONAL DISPARITIES
IN THE
SUPPLY AND
DEMAND FOR
HOUSING
It is obvious and well-understood that the housing
market displays extreme regional variation in England. It appears
that this tendency has become more pronounced although this appearance
can be exaggerated if you look at particular time periods, because
of the so-called "ripple effect". The regional disparities
are exacerbated by supply constraints, but it is clear that they
are strongly driven by economic and employment trends. In particular,
London plays a dominant role in our increasingly service-oriented
economy, with the "Greater South East" playing a very
important complementary role. Some people argue, of course, that
the right solution to our regional imbalance is to shift economic
activity and jobs from the south to the north, rather than building
lots of extra housing in the south. It is true that regional imbalance
is not new and that in the past (between approximately 1940 and
1980) we did have active regional economic policies which aimed
to move "work to the workers". More recently such policies
have been very limited, and partly channelled and constrained
by the EU.
The Committee may wish to ask the Government
to clarify its regional policy. My guess is that their answer,
if honest, is that they do not believe a 1960s-style regional
economic policy is a feasible option for them now, post-globalisation.
In other words, there is a reluctance to try to direct businesses
to locate somewhere other than where they choose, for fear that
the alternative choices are (in many cases) in other countries,
within Europe and beyond. The emphasis is upon all cities and
regions trying to make the most of their assets and to nurture
their "endogenous growth". Both Greater London and the
South East are perceived as key economic assets and drivers for
Great Britain plc.
Given this policy climate, I think it follows
logically and pragmatically that we have to provide housing to
support the economic growth where it is going to occur. If we
don't, our planning system will continue to be like driving a
car around with one foot on the accelerator and one foot on the
brake. The corollary is that, if local authorities or regional
assemblies in the south say that they don't want these housing
numbers, they should be saying no to the economic growth as well.
Then we might have a bottom-up regional policy.
REFERENCES
Barker, K (2003) Review of Housing Supply: Securing
our Future Housing Needs. Interim Report—Analysis. London:
TSO/H M Treasury.
Barker, K (2004) Review of Housing Supply: Delivering
Stability: Securing our Future Housing Needs. Final Report
& Recommendations. London: TSO/H M Treasury.
Bramley, G (1993a) The impact of land use planning
and tax subsidies on the supply and price of housing in Britain,
Urban Studies, Vol 30, 5-30.
Bramley, G, Cousins, L, Dunmore, K, Morgan, J (2002)
Evaluation of the Low Cost Home Ownership Programme. ODPM
Housing Research Report. London: ODPM.
Bramley, G, Morgan, J, Cousins, L & Dunmore,
K, with MORI plc (2005) Evaluation of the Starter Homes Initiative.
ODPM Housing Research Report. London: ODPM.
Bramley, G (2004) The Potential Market for Equity
Loans in the UK. London: Council of Mortgage Lenders.
Bramley, G (2005) Report to IPPR Commission on Sustainable
Development in the South East. London: Institute for Public Policy
Research.
Bramley, G & Leishman (2005) "Planning and
housing supply in two-speed Britain:" modelling local market
outcomes", Urban Studies. (December) 42:12. 2213-44.
Bramley, G & Karley, NK (2005a) "How much
extra affordable housing is needed in England?", Housing
Studies. 20:5, 685-715.
Bramley, G, & Karley, NK (2005b) Home-Ownership,
Poverty And Educational Achievement" Individual, School And
Neighbourhood Effects. Final Report to Scottish Executive
Education Department.
Bramley, G, Karley, NK (2005c) "Home-Ownership,
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J Doling & M Elsinga (eds) Home Ownership: Getting in,
getting from, getting out. OTB Research Institute for Housing,
Urban and Mobility Studies. Delft University Press.
Bramley, G, Leishman, C, Karley, NK and Watkins,
D (2005) Is New Housing Good for Your Neighbourhood? Small
area market impacts of new housing investment. Paper presented
at Housing Economics Workshop, ENHR Conference, Reykjavik, Iceland,
June 2005. Heriot-Watt University, Edinburgh. +44 131 451 4605
g.bramley@sbe.hw.ac.uk
Bramley, G & Watkins, C. (1995) Circular Projections:
new housebuilding, household growth and the household projections.
London: Council for Protection of Rural England.
Bramley, G, Bartlett, W, and C Lambert (1995)
Planning, the Market and Private Housebuilding, London: UCL Press.
Bramley, G, Munro, M & Pawson, H. (2004) Key
Issues in Housing: markets and policies in 21st Century Britain.
Basingstoke: Palgrave/MacMillan.
Stephens, M, Munro, M & Whitehead, C. (2005)
Evaluation of English Housing Policy Since 1975. London.
ODPM.
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